14. Recommendations and Next Steps
The following recommendations arise from the feasibility project in terms of developing a strategy for Phase 2 and for progressing the Guardbridge project to the drilling stage. Although some indicative costs are provided for a non-invasive geophysical survey, the EIA (if required) and the initial drilling stages, the detailed scope of the project and specific costs associated with any engineering, stakeholder engagement, financing and project management are not included, as they are somewhat contingent on findings from the environmental assessments and initial drilling results.
R1. The Guardbridge HSA Geothermal Heat Project should be progressed to the next stage which is a Development in the Low Carbon Infrastructure Transition Programme project. In this stage, the final business case, financing options and business organisation will be developed. Whilst it has marginal economic value at the end of the Catalyst stage, there are opportunities in the Development stage to increase the project value through proving better aquifer delivery, through cost reduction particularly with respect to locally sourced electricity pricing for the heat pumps, and optimising the business model and financing options with regard to different stakeholders. The Development stage will probably include drilling to reduce uncertainty before committing to the capital investment required for the District Heating Network. Alternatively, the DHN may be built with initial heat source from the biomass plant assuming a later progression once the geothermal heat source is available.
R2. Reduction of aquifer uncertainties requires a drilling programme. This is seen as a three-stage programme: build a detailed case for drilling, including decisions on whether test boreholes are going to add value; procure a rig and complete detailed well planning and permitting; drill and test the well.
To progress the first phase, which is the decision to drill a well, there will be several activities:
- Conduct a non-invasive geophysical survey of Guardbridge and surrounding area to attempt to remotely image the aquifer targets and the fault geometry and thickness and reduce the uncertainty in well trajectory for a deviated GB-2 well. Costs in the range of £10,000 will provide these geophysical data. About three months would be required to acquire, process and interpret the data.
- At the same time, planning applications will be submitted to Fife Council outlining the construction and completion phases of the geothermal exploration. It is most likely that an Environment Impact Assessment will be required before the project can progress to the site preparation and drilling stage. Relevant license applications to SNH, Fife Council, as well as SEPA, will be completed and, if deemed necessary, an Environmental Impact Assessment will be completed. The time frame for this is a minimum of 3 months at an approximate cost of about £30,000, but could take longer and be more costly if more baseline data are required by Fife Council and/or SNH. Permission to drill must be negotiated with any landowners affected.
- Revise the well trajectory based on increased geological knowledge and understanding of directional drilling constraints at shallow depths.
- Review available (offset) well data on rate of penetration, drilling fluid and well control to better constrain design and costs.
- Decide whether a "minerals" slant or a geotechnical rig and an exploration borehole will add value or significantly reduce uncertainty in the final well. This will depend on whether these lower cost approaches can provide meaningful data on aquifer flow potential.
- If an exploration well is decided, a rig will be procured, the well plan completed and drilling undertaken assuming all permissions are in place. Work to reach this stage will require at least six months and planning costs in the range £30,000 to £50,000. A test bore will cost in the range £100,000 to £450,000 depending on the objectives of the well and necessary rig type.
- Evaluate the results of the exploration well, including flow rate tests and water chemistry, revise the final well design and optimse the well completion design.
Note that the procurement and detailed well planning and permitting time for the final production well has not been estimated as it would require a formal organisational structure. This would form part of the activities of the project in its Demonstrator Stage.
R3. The consortium involved in this feasibility report should be responsible for Phase 2 work and the creation of a suitable ESCO or similar organisation would occur at an early stage to take the project forward to execution and operation, if decided.
R4. An economic model comparing re-injection costs (requiring a second well but extending the life of the resource) against on-site water recycling (costs and re-sale value) or disposal-to-sea (environmental concerns) is required in Phase 2, in order to finalise decisions on water management. Currently, the estimated water treatment costs include development of a settling pond, and the CAPEX and OPEX for filtration and chlorination (£350,000). Any disposal to sea of treated water has to be approved by the competent authorities. Higher salinity water may require reverse osmosis (vacuum membrane) treatment with higher operational costs and results in a residual brine waste.
R5. Optimise CAPEX and OPEX assumptions in the project. In particular, the best case in this study has highlighted the value added by accessing lower electricity prices throughout the project's life for heat pumps. This may be possible through accessing the generating capacity of the Guardbridge project as new energy sources come on line.
R6. Revision of the DHN design to accommodate any changes in the customer base at Guardbridge would be made after a decision to complete the well is made, and at that point more detailed plans and costings will be produced.
R7. Some of the geothermal water can be recycled on site to potable standards as part of an geothermal heat and water recycling project, developing a circular economy model for the resource. The on-site demand and re-sale potential should be evaluated as part of Phase 2. The innovation centre and University is well placed to advance research in streamlined water management for geothermal projects.